Raiffeisen Bank International plans to sell some of its Russian business
Raiffeisen Bank International (RBI) is set to retain a minority stake in its Russian business even in the event of a sale, according to its own statements. "We will likely sell 60 percent and keep 40 percent," CEO Johann Strobl said in a conference call with analysts on Tuesday. However, the bank has not yet found a solution that meets the requirements of all parties.
To sell its Russian subsidiary, RBI needs approval from a total of five authorities. Besides the green light from the Russian central bank and President Vladimir Putin, the US sanctions authority OFAC, the European Central Bank (ECB), and the Austrian financial market authority (FMA) must also give their consent, according to the manager's words.
Strobl said RBI hopes that the bank will still receive a dividend from Russia even after a partial sale. If the sale does not go through, the bank could also apply for a dividend payment from Russia. So far, RBI has refrained from doing so as it would then be committed to the Russian market.
Furthermore, RBI plans to accelerate the reduction of its business in Russia in the coming months to meet the requirements of the ECB. The loan portfolio is set to shrink by 55 percent to around three billion euros by 2026. No new loans will be granted, except for a few exceptions, and payment transactions within and outside Russia will be largely restricted. RBI plans to charge high account management fees from its customers. These measures have been coordinated with the ECB and the US Treasury Department has been informed.
RBI is also scaling back its business with other banks. The Russian subsidiary bank will only accept deposits from institutions with a Western parent company. In corporate banking, only a few large, international customers will still have the option to conduct transactions.
The European Union, as one of the authorities required for approval, needs to give its consent for Raiffeisen Bank International (RBI) to sell its Russian subsidiary, following the regulations mentioned by the bank's manager. Despite the challenging circumstances, RBI continues to maintain a stake in its Russian business, reflecting its commitment to the European Union's economic policies in the region.
